tv First Business FOX October 26, 2012 4:00am-4:30am PDT
ngress.in today's cover story.....sales are not- so-spooky anymore. what predictions for halloween spending says about the economy. this is isn't just any hd tv. why the next big trend in flatscreen tvs could cost you 20 grand. plus....traders give us their vote on which way the market is leaning in the election. and.... what apple earnings reveal about ipads, iphones, and consumers.first business starts now. you're watching first business: financial news, analysis, and today's investment ideas good morning. it's friday, october 26. i'm angela miles. in today's first look traders will be talkin' tech today. apple missed on earnings, although revenue was strong. iphone sales were solid, while ipad sales were weak.
pandora tripped the circuit breakers yesterday after bloomberg news reported apple is planning a radio service similar to pandora. the stock tumbled 11% in a 10 minute free fall. amazon was another downer last night. the tech company posted its first quarterly loss in 4 years. here's a bright spot. expedia stock soared 11% on better than expected earnings. that stock is up more than 70% this year. mark sebastian of option pit mentoring joins us now. what do you like in tech earnings that could actually move the market today? we had amazon announced last night and they're a big global retail company and they missed badly. if gdp this morning is poor as well it could be kind of an ugly day. i actually think amazon is a very good indicator of global growth and they missed on bottom and top line earnings and revenue. what's the market implying right now? what's the vix telling you as far as the actual fluctuations throughout the trading day? i think there is a lot of bad sentiment set up
butif you look at how much the market is actually moving, the vix is trading at a massive premium. people look at a vix 18 and say that's pretty cheap. when you consider the market's only moving at about 12 percent, the vix is actually really expensive. it shows you how well insured the market currently is. what do you think about the friday trader going into this weekend? gdp is gonna drive things this morningbut don't be surprised if we get a little weakness at the end of the day. one of the things we've been seeing is people do not want to carry longs into the weekend and i don't blame them. good to have you on the show today. that's mark sebastian of option pit mentoring. in our cover story---retailers expect consumers will spend more on halloween this year than they did last year. ---significant for those riding through scary economic times and hoping that the second most profitable holiday for retailers is an indicator of consumer confidence. brian bowers' 'halloween hallway' pop-up store is filled
with more shoppers than ever. "yea it's a huge holiday for my friends and i. we'll dress up and go to several parties." and to some--halloween spending--is an indicator of consumer confidence. "we'll spend" "a little more." the national retail federation says americans will spend 80-dollars per person on candy, costumes-- a majority for adults, and creepy decorations this year...turning halloween into a scary success --an eight billion dollar holiday for retailers. bowers who owns eight pop-ups already has plans for more. "we're going to collect an aggregate of vacant business space that we can rent to pop-ups." "they don't want to grow up." jim dion, a retail analyst says the pop-up business model is perfect for halloween
and other holidays. "they can buy $50,000 of inventory and six-weeks later, make $150,000 profit."but halloween is still second to the most profitable holiday season in december. many retailers are gearing up for that. "some retailers decided to forego halloween to focus on christmas." "the last ten days before christmas is when everybody makes their money. new costumes this year include some inspired by the video game angry birds, the movie "ted" and korean rapper "psy" whose hit single 'gang-nam style" persona might show up at your door or party. holiday hiring for the christmas season continues to shape up better than expected.
career builder reports fs 36% of retailers plan to hire extra help-- up from 29% last season. 39% surveyed plan to transition the workers into permanent staff. and 62% are hiking up what they pay seasonal workers to $10 more. the majority of retailers are hiring heavily in october. gas prices are nearing the boiling point in california, and congress may step in. gas prices hit a high of $4.70 a gallon in october. and have since dropped to $4.30. that's still nearly a dollar higher than last year. california's democratic senators have called for a federal investigation. they've been joined by republican senators from alaska and oklahoma who want congress to look into how regulations may have caused the spike. the number of foreclosures in the majority of the u.s. have fallen to levels not seen since 2007. realty trac tells reporters the worst is over for most of nation. however, foreclosures remain highest in sections of california, illinois, and
florida. execs at top companies want a debt deal from congress to fix the nation's deficit. according to the wall street journal, an open letter to congress asks for members to use a mix of spending cuts and tax-revenue increases. the letter was signed by 87 heavy hitters including goldman sachs' lloyd blankfein, and j-p morgan's jamie dimon. it asks to follow the 2010 deficit reduction plan. the statement does not endorse a presidential candidate's economic plan. ford is having more car trouble overseas. due to stalling sales--the u.s. automaker now plans to close 2 plants in england, on top of the belgium plant closure announced earlier. cutting a total of fs 57-hundred jobs. ford anticipates european losses will exceed $1.5 billion this year. and next. next week gm is expected to detail the re-structuring of its opel unit which has been losing money. the drag in the u-s economy slapped the cme group with a 30
percent drop in third quarter profit. it wasn't all due to regulatory changes, according to cme chair terry duffy. he admitted regulatory issues had a role in the profit slowdown.... but the slowing economy and flat interest rates dealt most of the blows to the bottom line. pro- gay marriage supporters protested outside restaurants after chick fil president dan caathy said he supported the biblical defintion of the family unit. it's being reported the number of people visiting the chicken shops increased 2.2% in the past month. a slew of major airlines are reporting third-quarter earnings. and results are mixed .... fewer flyers contributed to revenue declines at united and american. united said contract negotiations with its pilots set the airline back financially. american also addressed pilot contract issues, but said september's flight cancellations due to pilots calling in sick
-- did not affect the companies 'bottom line.' the airline plans to hire 25- hundred pilots within the next five years. delta's profits doubled from last year---a result of more passengers. while us airways posted a "record" net income of 245 million dollars. in other corporate earnings... the third-quarter was a mixed bag, and layoffs are on the agenda. procter & gamble beat estimates. the household products maker said it will cut fs 5700 jobs by year-end. rival colgate-palmolive plans to cut fs 6 percent of its workforce by the end of 2016. earnings fell a bit short of estimates but were better than last year. sprint beat expectations on strong revenue. while royal caribbean earnings were weaker than last year, but the company is "encouraged" by increased bookings. energy drinks are causing a caffeine controversy. consumer reports study finds labels on some popular energy drinks are missing information. consumer reports looked at 27 brands, and found that 11
brands do not include caffeine on ingredient labels...and five have inaccurate amounts labeled. the study follows an fda investiation into monster beverages after a 14-year-old girl with a heart condition died after drinking two monster energy drinks within 24-hours. monster told consumer reports there is no legal business requirement to disclose caffeine levels, and that its products are "completely safe." it's a busy week for tech companies. microsoft is positioning to stay in the gagdet game is out with its new windows 8-- designed to run on pcs and tablet computers. microsoft has new tablet to go with it, the surface tablet hits stores today..fs for $499. the samasung galaxy note 2 goes on sales today.. it's a phone and tablet- known as a phablet. it sells for $299. pre-orders start today..for apple's new i-pad mini. at 329 dollars, its pricer than tablets from amazon or microsoft. apple defended pricing this week, saying consumers will be willing to pay for apple's quality. here is what apple fans told
us-- "it just seems like a rasonable price for the product." "i think it's really good that there's a segment of the population who'll pay for that (but you're not one of them) no." while the 'mini' is all the talk right now -- it seems there will soon be a glut of supply of older versions of the ipad. market watch.com is reporting that ipad re-sales are up a whopping 700% since the minis launch this week. the next generation of tv's here along with an eye popping price tag. the lg 84 inch ultra hd tv is selling in stores now for $20,000. sony reportedly rolls it's new ultra hd next month for $25 grand. more than likely if the products are popular the prices will fall.... eventually. .across the pond.... england's economy improved in the third quarter, with help
from the london olympics. the nation was able to climb out of recession due to higher gdp numbers from the summer games. gdp rose 1%. however -- the lift may be temporary. economists say other than the olympics, england's economy remains weak , and susceptible to effects from the euro crisis. still to come which candidate the market favors in the upcoming election - and why the answer could be hidden in the numbers. thats later in traders unplugged. but first....does corporate america need an ethics lesson? that's next with bill moller.
the insatiable greed, the selfisheness, misconduct that has ruined the balance sheets and reputations of so many banking and finance companies has prompted many to call for more vigilant regulation as well as a fundamental change in how businesses are run. robert maybery is the ceo of maybery and company, a global leadership consulting firm. you have written and talked much about all of this. how pervasive are the bad actors that you talk about? the barbarians out there in the corporate world. they're pervasive at a scale that would frighten most. in short, more pervasive than you and i would like. a lot of people would say, we just need more regulation. is that the solution? you cannot regulate leadership. you cannot regulate ethics. what we need to do is go
back to the drawing board and understand what it is that we need from leadership and our leaders. do boards have a pretty important role here in keeping the feet of the ceo to the fire? to be sure that they operate in a principled manner? they are everything. the chairperson of the board is as important as the ceo appointment and boards need to be held a lot more accountable than they have in the past. i am mortified that over the past 4 years we haven't seen more boards brought to book for the absolute monstrous destruction that's taken place in terms of stakeholder value. not just shareholder. there's an over- emphasis on the shareholder. we have to consider and confirm that there are many stakeholders in relation to business and government. you've talked about the fact that so many companies are completely beholden to the debt and equity markets. that
they are the masters. it's a relationship that needs to be decoupled and reworked. a ceo who's taken the stance and initiative is paul pullman of unilever who has said in a very pithy response---we're transforming and it's going to take 10 or 15 years to create the unilever that the 21st century requires. we need more leaders of paul's ilk who are prepared to speak straight with the street. and embodies such things as what? empathy for one. for me it comes down to a number of issues. one is the ceo in the 21st century needs to have a mentality of abundance and a spirit of munificence. and that emblematically encompasses---empathy, compassion, selflessness, and a very well defined sense of identity within the individual. well, you're writing a lot about this and good for you robert maybery. i applaud you for your efforts. my pleasure bill. thank you bill, still ahead.... apple, google or microsoft. two traders weigh in on which stock gets their vote. thats next.
in today's traders unplugged we have options pro alan knuckman and popular oil trader phil flynn, who also contributes to fox business news---ready to tangle over hot topics. good morning gentlemen. good morning. round number one--- stocking up on the candidates... what's the market telling us about the election? i don't think it matters who gets elected. the performance of the last president--we've seen the stock market go up 100 percent. as a capitalist, regardless of
your party if you can ignore your ideology---which i know you can't, i think you have to respect the returns in the marketplace. all of a sudden he doesn't care who's elected. this guy has been shilling for obama for a century. i'll tell you what--i think he's right, alan is right. the stock market is telling us something about the election. it's telling us that romney may win and that's why the stock market's been selling off here for the last couple of days. so that's what you want? you want the market to sell off? maybe we have to unwind the leverage instead of this bubble---we are the most de-leveraged that we've been . we've been printing money like crazy. round number two---will the month of october end with tricks or treats for investors? boo---i think we're gonna have tricks. it's an election year. how can you not have tricks out on election year? the treats may come after the election or to the voters that are undecided, they're getting the treats. i think people are still
somewhat spooked because we had such an extended run. we celebrated the 25th anniversary of the '87 crash. people are a little bit nervous even though a lot of the fundamentals are still solid and continue to get better. right now we've got gas prices 25 percent below the highs of this year. isn't that better? not according to president obama in the last debate. he was saying when i came into office the reason why gasoline prices---the economy was taking a turn for the worst. as you misquote me, you misquote his intentions. higher crude prices on a golbal market are a sign of global strength. what's the better buy? apple, google, or microsoft? it's been a busy week for tech. i really like all of them. i think that the pullback that we've seen in the tech sector presents a buying opportunity. looking at apple, we can see a 25 percent move based on the chart pattern we saw from the 640 to the 520 wedge there. google could be up 30 percent at 875 and i'm looking for microsoft to get up 20 percent at $34. i hate them all. i hate them all. i hate tech here. and i'm angry. i'm an
apple guy--i have all the ipads. i have to go out and buy a new phone, new cords---all that money i don't like it. you don't have to. there's no gun to your head. but you want to. they have you on a leash. that means more profits. bonus round---name the richest people or the richest person or family on reality tv? the braxtons, the kardashians, the duggars, or honey boo boo? they got a raise to 10,000 per episode, that's not really rich. even though they're fools for being on tv. who are the guys in vegas that sell all the stuff in the store? the pawn guys. they're making so much money that stuff it's unbelievable. the jacksons songs are the empire. the jackson songs? name one. the pawn star dudes. who's the chubby guy? i'm not one to call people chubby. and you should not criticize people's physical appearance. you're so far off the charts. it's the kardashians. reportedly they've signed on for $40 million for 3 more seasons. can i ask a question? who are the kardashians? thanks for being on the show. still ahead- a trader gets real about apple's earnings.. chart talk is next.
it trade. it opened up right around 590. if you look at the 24 hour print it actually said it printed at 585---which is the 200 day moving average. got some buyers, got above 600--- then it was trading above 600 for a while. actually got above 610. which i'm actually surprised. i thought their earnings per share were bad, their revenue was bad, their guidance was bad, their ipad number was bad. everything more or less was bad. but the stock didn't sell off that much. i guess $100 from the high which is 705 down to 605. sounds about right with the earnings. what does that tell you when you see a bounceback in the afterhours and now we have a whole new fresh session this morning. it's interesting i've actually been on the show and saying how much i love apple but i like money more than i like apple. the trend is lower. it's making lower lows and lower highs. i shorted it at 625. i sold more in the afterhours session last night right around 610. so i am short apple right here. my my stop is going to be around 640 or 650. very similar thing to amazon. we saw amazon get to 205. then it got bid up. that was up $15 from the lows as well. so apple and amazon got bid up yesterday. it should
be interesting to see what happens today. another thing i can look at today, i can see the high of the day and see if it goes above the high of the day and that could be my stop as well. but i am playing apple to the short side. it's making higher lows and lower lows and i think the stock is heading lower to the 585 200-day moving average once again. a bearish tome coming from andrew keene of keeneonthemarket.com. thank you have a good friday. it's closing time for this friday. coming up next week-- how to break the smart phone addiction. from all of us at first business.. have a wonderful weekend.
we are live in san francisco where a man is fighting for his life after a shooting. we'll tell you what doctors found in his pocket that is essential to this investigation. giants packed up overnight for their big trip to detroit. they were embracing for the worse. how the demonstration turned. good morning. it is friday october 26th i'm brian flores. >> and i'm pam cook. thank you for waking up with us. steve, is it just me or is it cold outside? >> it is cold.
why did you wear that jacket in here? because it's cold in here. it will be a sunny and warmer day. temperatures will start off on the chilly side but they will warm up and we have lots of 70s. in fact a few mid 70s. we'll have more on your weekend forecast in five minutes. here is sal. highway 4 traffic looking pretty good as you come up to the will low pass grade there are no major problems here. some of the road work is still there in the antioch area in the eastbound direction. also this morning we are looking at interstate 880 near the coliseum and that traffic does move well. let's go back to the desk. we are following breaking news of a shooting in san francisco south of market neighborhood. ktvu channel 2 news tara moriarty is there at san francisco general hospital with the latest on the victims condition and et search for a suspect. tara. >> reporter: the victim's friend drove him here after he was shot. we understand he is in critical